Consumer Duty

The FCA wants to make sure that consumers are properly protected by every producer and distributor of financial services or products. To make sure we all know what’s expected of us, they’ve introduced the Consumer Duty.

These new rules aim to achieve good customer outcomes in the four key areas of ‘price and value’, ‘consumer understanding’, ‘products and services’ and ‘consumer support’.

Consumer Duty is a new set of standards created by the FCA to improve consumer protection and build more trust across the spectrum of financial services.

The Duty lays out an overriding Consumer Principal:

A firm must act to deliver good, reasonable outcomes for retail customers

And is supported by three cross-cutting rules and four customer outcomes.

Three Cost Cutting Rules

A firm must:

  • Act in good faith towards retail customers
  • Avoid causing foreseeable harm to retail customers
  • Enable and support retail customers to pursue their financial objectives

Four Consumer Outcomes

Products and Services
This outcome aims to ensure products are designed with a clear target market in mind and that the customer’s needs, characteristics and objectives are documented.

Price and Value
This outcome aims to ensure customers pay a fair price for the product or service they receive and that the price paid is reasonable compared to the overall value and benefit they receive.

Consumer Understanding
This outcome requires firms to provide clear information so customers can make informed decisions about financial products and services.

Consumer Support
This outcome aims to ensure customers have sufficient support and information to meet their needs throughout their relationship with a firm.

Supporting Documents